VanEck to Liquidate Ethereum Futures ETF Amid Waning Interest

VanEck, a leading investment management firm, has announced plans to close and liquidate its Ethereum Futures ETF (EFUT), signaling a significant setback for Ethereum (ETH) as it navigates a volatile market.

The decision stems from diminishing market interest, performance concerns, and other factors.

The ETF, listed on the CBOE exchange, will allow shareholders to sell their EFUT shares until September 16, 2024. After that date, trading will cease, and the fund will be delisted, with a liquidating distribution set for September 23, 2024.

This move also reflects VanEck’s strategic shift towards spot market offerings, following the approval of its US Spot Ethereum ETF and a similar decision regarding its Bitcoin Futures ETF earlier this year. The firm’s decision underscores the challenges facing Ethereum futures in a declining market environment.

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The liquidation process will involve cash distributions to EFUT shareholders, potentially impacting those with holdings in brokerage accounts. VanEck has advised investors to consider tax implications, as the distributions may result in capital gains or losses.

The termination of EFUT highlights the struggles of Ethereum ETFs amid fluctuating market dynamics. With ETH prices down nearly 4% to $2,284 and trading volume up 34%, the market is bracing for further volatility. Recent analysis suggests ETH could drop to $2,000, adding to the selling pressure.

Alexander Stefanov